Sizing up the $434-million MCC grant

First published at thepoc.net

At the posh Waldorf Astoria Hotel in New York last week, the US ceremonially sweetened its relations with the Philippines with a USD434-million grant to the Philippines for the implementation of a road project and other anti-poverty programs. Widely perceived as a vote of confidence for the new administration, the compact also spells out the reaffirmed geo-political and economic interests of the US in the country.

President Benigno “Noynoy” Aquino and US Secretary of State Hillary Clinton stressed the strong RP-US ties in their remarks over the signing of the five-year compact under the Millenium Challenge Corporation (MCC), a US-run development agency. MCC was created by the US Congress in 2004, forming partnerships with some of the world’s poorest countries.

“We want to assist the people of the Philippines to be able to do more for themselves, and we also want to see results from our investment. This was a negotiated agreement,” Secretary Clinton said. For his part, President Aquino said the projects under the compact “demonstrates the country’s ‘high capacity’ as an MCC partner.

Presidential spokesman Edwin Lacierda said the MCC grant proves the trust of the US in the reforms being pushed by the Aquino administration against corruption and towards poverty alleviation.

Nearly half of the grant will be used to fund the Secondary National Road Development Project (US214.4 million) which focuses on the repair of roads and bridges in Eastern and Western Samar, a prioritization lauded by Eastern Samar Rep. Ben Evardone.

Ironically, Samar was the crime scene of the infamous Balangiga massacre in 1901, wherein the heavy-handed retaliation of American troops following a surprise guerrilla attack resulted in the death of around 3,000 Filipinos.

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Europe-wide general strike on Sept. 29

"No to Austerity! Priority for Jobs and Growth"

Perhaps for the first time in many years, a Europe-wide general strike will be launched against the austerity measures recently adopted  by many European countries, and to demand recovery plans in favour of decent and quality jobs. The general strike is the culmination of a series of workers’ demonstrations rocking many parts of the region as European governments impose spending cuts on social services and new tax measures as proposed by the International Monetary Fund (IMF).

Major unions and federations are expected to participate in the 24-hour all-Europe strike, including the European Trade Union Confederation, UK’s biggest public sector union Unison, and Portugal’s 750,000-strong CGTP union. Millions from other sectors are also expected to join the mass rallies across Europe. Around 80 percent of European flights will be on standstill on the day of the strike.

The International League of People’s Struggles (ILPS), a broad global anti-imperialist front, has expressed its support and solidarity for European workers in connection with the Sept. 29 Day of Action.  It also called its member organizations and allies in Europe to participate in the general strike. In a statement, ILPS said the Sept. 29 massive protest is “aimed at protesting the rising rate of unemployment, the lowering of wage levels, the attack on pensions and the cutting back of social services as a result of austerity measures being imposed by the European governments.”

Below is a quick glance on previous and pending mass actions by various federations/ workers’ organizations from UK to Spain and to Poland (Source: Reuters):

* FRANCE:

June 24 — French unions held nationwide strikes in which thousands of workers protested against pension reforms, challenging Sarkozy who has vowed not to back down.

Sept 7 — French trade unions mounted a show of strength with strikes and massive street protests against pension reforms raising the retirement age to 62 from 60 by 2018.

Sept 22/23 – Union-organized strikes disrupted rail and air traffic and schools, forcing airlines to cancel 40-50 percent of flights and halving intercity rail services. The union action was in protest against plans to raise the retirement age to 62 from 60.

* GREECE:

May 4-5 — Public sector workers staged a 48-hour nationwide strike. On May 5, a 50,000-strong protest in Athens led to violence in which demonstrators fought police and three people were killed in a petrol bomb attack on a bank.

June 23 — Communist trade unionists prevented travelers from boarding ships at Greece’s largest port, stranding tourist ferries as part of protests against austerity measures.

June 29 — Police fired teargas at rioters shouting “burn parliament” in Athens. About 12,000 people joined marches during a 24-hour strike against drastic pension reforms.

July 8 — About 12,000 people took to the streets to urge lawmakers not to vote for a drastic pension reform which would raise the retirement age to 65 for all. It was the unions’ sixth 24-hour strike against austerity measures.

Sept 11 — About 20,000 people marched through the city of Thessaloniki to protest against austerity measures.

Remarks of Sec. Hillary Clinton, President Aquino at signing of new MCC compact

Waldorf-Astoria Hotel

New York City

September 23, 2010

AP Photo

SECRETARY CLINTON: Thank you very much. It is a true pleasure for me to be here and I want to thank Daniel Yohannes and the entire MCC team – we have board members and staff members here – for their hard work every day, but particularly for this compact. It is an exciting moment in the relationship between the United States and the Philippines, a very long relationship that is now focused on the future. And it is a great privilege and honor to welcome President Aquino here. Of course, my colleague, the Foreign Secretary Romulo, thank you for being here with me. And thank you as well, Secretary Purisima, Ambassador Gaa, and all of our distinguished Filipino guests.

One of the joys of my job as chair of the Millennium Challenge Corporation Board is watching countries make gains because of their own hard work, but with the help of the United States. The compact we are signing today is only possible because for the past few years, we have seen evidence of a commitment to deliver for the people that we believe is represented in the promise of President Aquino’s election. One of the projects supported by this compact, Kalahi, comes from a Tagalog phrase that means “linking arms against poverty.” I think it’s a wonderful phrase because that’s exactly what we’re doing with this Millennium Challenge Corporation compact.

We want to assist the people of the Philippines to be able to do more for themselves, and we also want to see results from our investment. This was a negotiated agreement. This was not a decision just to give the Philippines some money – although I’m sure that’s welcome to our friends – this was a negotiation. Because that’s the whole idea behind the MCC; there are certain principles that we believe in, and the Philippines has made a commitment to these principles. We believe that you can unleash the human potential in a country like the Philippines by tearing down the barriers to economic growth and fighting corruption, which is like a cancer in the economy and society.

Unmasking the promise of Aquino’s US trip

First published in Blogwatch.ph

As the President arrives in the United States for his first official overseas trip, he leaves the nation with the same old investment mantra uttered by previous regimes. Indeed, even if the cost of the trip (estimated at P25 million) has been cut, the same price will be paid by Filipinos – depressed wages, high-risk jobs and denial of labor rights – in exchange of the investments that he may bring home.

In his departure statement posted on the government website, President Benigno “Noynoy” Aquino said his US trip is in line with the government’s goal to strengthen public-private partnerships, generate jobs and livelihood, and ultimately to move the country towards economic progress. In the same breath, he sounded like a huckster peddling a nation mired in poverty to foreign profiteers: “The Philippines is open for business.” It’s as if the Philippines has been closed from foreign interests since the Spaniards came.

Obviously, Aquino’s main agenda in his trip is to lure foreign investors to supposedly create jobs for Filipinos and attain progress, which is no different from the agenda of his predecessors. The same promise of economic progress, now only packaged as the “righteous path,” is being used as selling point to once again force the myth of investments into our minds. The reality of globalization however dictates that luring investments means ensuring that wages will be kept very low while beefing up incentives for transnational corporations. That is the surest way to corner investments, aside from other considerations. And Aquino is expected to mouth that bargaining trick in his meet with business executives from the US.

He hinted at this in a separate statement before he left for the US trip. He stressed the need to “rationalize a regulatory system that has been, in many years, a disincentive to foreign investors.” Simply put, the government will further bring down tariff rates and taxes, boost incentives and cut red tape to encourage investors to set up their businesses in the country. This also means further narrowing revenue sources despite the sorry state of the budget.

Based on a recent presentation by the Philippine Economic Zone Authority (PEZA), the government earned only P508.1 million last year from the operation of PEZA-registered ecozones, the primary area for foreign investments. Despite the hype on the supposed huge revenues from ecozones, the amount is only half of the proposed P1-billion pork barrel for the President, and a negligible 0.03 percent of the proposed P1.654 trillion budget next year. And when the government decides to further bring down tariff walls under the pressure of the US, we can expect PEZA’s measly remittance to shrink. Apparently, the Aquino administration’s is willing to show generosity to foreign companies even as it remains bent on imposing budget cuts to the state colleges and universities.

Meanwhile, the worth of PEZA ecozone exports stands at US$23.39 billion from January to July this year. This amount is 1,170 percent higher than Bangko Sentral ng Pilipinas’ projected FDI inflow of US$2 billion for the entire year! Clearly, foreign corporations are reaping huge bonanzas out of their measly investment to the country, highlighting the highly unequal trade under neoliberal globalization which Aquino wants to affirm in his US trip.

A closer look at Aquino’s ‘reform budget’

First published in the Philippine Online Chronicles

(Photo by Dvemor)

The President calls it “reform budget,” but some see it as a detour to patronage, reduced social spending and heavy debt servicing.

In his budget message to Congress, President Benigno “Noynoy” Aquino said his proposed P1.654 trillion national budget “has been formulated to turn our vision for social reform into a tangible reality for our fellow citizens.” The proposed budget is 6.8 percent higher (an increase of P104.4 billion) than this year’s budget.

Lawmakers are eyeing the passage of the 2010 national budget before the year ends.

Aquino said the government used zero-based budgeting for next’s year’s budget to supposedly ensure that taxes paid will be spent for the people. Under the scheme, the government intends to cut existing programs such as the education department’s Food for School Program and the Department of Agriculture’s Input Subsidies for allegedly failing to meet its objectives.

Savings from the cuts will be channeled to existing programs which Aquino said are “performing well,” including DSWD’s conditional cash transfer program.

In PAL, Aquino is the hostage-taker

First published in Blogwatch

As the Aquino administration busies itself with its defense over the Aug. 23 hostage crisis, the livelihood of thousands of Philippine Airlines (PAL) employees remain on the line. Sooner or later, the flag carrier’s labor woes, which the President diagnosed inaccurately, will develop into another emergency.

On Thursday, the 1,600-strong Flight Attendants and Stewardesses of the Philippines (FASAP) filed a notice of strike at the labor department as the company still refuses to grant their demands.

FASAP president Bob Anduiza said they are demanding an increase in their salaries, paid maternity leave and the scrapping of the mandatory retirement age at 40 for female flight attendants, which he said is rooted in the mentality that a plane’s crew is mere eye-candy rather than trained safety professionals.

Accounts which I received first-hand from flight attendants confirm PAL’s gender discrimination and its unfair labor practices. According to them, female applicants should not be older than 27 years old. “Overweight” flight attendants are suspended without pay until they gain the ideal weight as determined by the company. When a crew gets pregnant, the company imposes a forced leave without pay that can last up to two years (since it is required for the crew to regain her pre-pregnancy weight ). The entire duration of the maternity leave is also not included in the computation of benefits.

Indeed, the same exploitation of women which characterize prostitution dens happen 36,000 feet above the ground.

Another less-discussed dimension of the plight of PAL flight attendants is the union’s assertion of labor rights. Since 2007, the company has refused to enter into collective bargaining negotiations with the union, thus denying crew members of better wages and working conditions. Some of them currently receive salaries that are below the minimum wage, a stark contrast to their glamorized portrayal in teleseryes and films.

Cabin crew members are also overworked due to the reduction of flight attendants per flight. For instance, PAL has reduced the number of crews from 18 to 12 for international flights to mitigate alleged losses.

The company has offered an P80-million package as consolation for the three-year suspension of CBA talks. The package is quite a chunk of money, but when divided among 1,600 crew members and 54 months (the duration of a CBA), each crew will only receive a raise of only P926 per month (very low in terms of the industry’s standard). This scheme is no different from the package which Hacienda Luisita Inc. forced into the throat of some 3,000 supposed farmer beneficiaries.

The package also pales in comparison with PAL’s combined passenger revenues worth P165.14 billion from 2006 to 2008 alone (based on the company’s financial statement). This is aside from the fact that PAL’s owner and CEO Lucio Tan has a fortune worth P78 billion (US$1.7 billion) according to Forbes Magazine.

A reliable source said the package is being offered with a precondition: the spin-off and outsourcing of PAL’s airport services, inflight and catering units must push through first before the company grants the package. In other words, Lucio Tan is goading FASAP to support the planned spin-off and outsourcing which will lay off at least 2,600 ground employees – a tactic meant to sow disunity among PAL’s workforce. But FASAP has so far stood its ground, opting to launch a strike instead of falling into Lucio Tan’s trap.

Concerns on tourism and convenience of the riding public appears to be the rhetoric of the times against the planned move of FASAP. President Benigno “Noynoy” Aquino even put forward the silly proposal to implement an “open skies”policy to supposedly address the labor situation.

But what about the labor and gender rights of PAL flight attendants? After all, isn’t a significant portion of passengers boarding PAL (around 3,000 everday) are Filipino migrant workers who are also victims of the dismal job situation in the country? It is simply unjust to pit the passenger with the flight attendant to absolve Lucio Tan of his grave labor rights violations.

Those who subscribe to the government’s idea of protecting tourism first before PAL employees should reflect on the argument: Why is it that the government always worry losses in revenues and investments from tourism? Such reasoning exposes the basic weakness of the Philippine economy, being solely reliant on tourism as well as on remittances. It gives a glimpse of how we as a nation fail to take off due to the primacy of foreign capital and investments over our own workers and economy.

Aquino’s “open skies policy” will actually not solve the labor problems in PAL. The measure will actually stoke a bigger unrest since inviting foreign airlines to take up the slot of PAL will lead to a more massive retrenchment of employees. Essentially, Aquino is hostaging PAL employees using the “open skies” threat to keep their mouth shut and drop their strike plan.

On the contrary, he is letting Lucio Tan run scot-free from his obligations to employees with his billion-dollar fortune intact. After all, the taipan has nothing to worry over the government’s threat since he can outsource PAL’s “non-core units” to his wives and children.

The President himself has said it quite pointedly during the press conference hours after the hostage-taking incident: Why employ the final option as the first option? Now I am throwing back the question to you, Mr. President. Why not listen first to PAL employees’ demands?

It appears, though, that Aquino is bent on playing the role of hostage-taker instead of negotiator over the labor dispute.